Zero Hour Contracts

Zero hour contracts normally refer to contracts of employment, which do not guarantee the employee a minimum amount of work. They are used by employers because they minimise overheads, i.e. during quieter periods the employee can be offered little or no work and vice versa.
Zero hour contracts have been condemned by unions and caused political controversy due to the perceived imbalance they create between employee and employer. They were a significant issue at the 2015 General Election and politicians have been pledging to address them since at least 1997.

The common perception of these contracts is that the employee is effectively at the employer’s beck and call, forced to work when it suits the employer’s commercial interests without having the stability of a fixed salary.
This perception, at least in terms of the party’s legal obligations, is not entirely accurate as employees are not usually required to accept any work offered.

On 26th May 2015, new regulations came into force (The Exclusivity Terms In Zero Hour Contracts (Redress) Regulations 2015). These regulations prohibit exclusivity clauses in zero hour contracts, namely clauses that prevent an employee working for other employers.
The regulations state that it will automatically be unfair, if an employee is dismissed for breaching an exclusivity clause. There will be no qualifying period of continuous employment in order to bring a claim for unfair dismissal in such circumstances.
Additionally the regulations make it unlawful to subject an employee to detriment for breaching such a clause, for instance reducing the usual hours that they are offered.

In light of these recent regulations, it is unlikely that the UK will go the way of New Zealand and abolish zero hour contracts altogether, any time soon.

Unfortunately it may be impossible for the aims of the regulations to be achieved. For instance some employers may not use exclusivity clauses in contracts but will develop a practice of discriminating against employees who work for other employers. Similarly proving detriment will be difficult as it will involve a detailed analysis of the employer’s business practices.

Most zero hour contract employees are low paid workers and legal costs are not normally recoverable in the Employment Tribunal. Therefore it is unlikely that solicitors will be prepared to accept instructions for breaches of the new regulations.